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At the Time That Stellar Company Issued a 2-For-1 Stock

Question 54

Multiple Choice

At the time that Stellar Company issued a 2-for-1 stock split, the company had 1,000 shares of $5 par value common stock outstanding. Stockholders' equity also included $14,000 of additional paid in capital in excess of par value and $20,000 of retained earnings. Immediately after the stock split,


A) the balance in the common stock account would be $10,000.
B) the amount of paid-in capital would be $20,000.
C) the balance in the retained earning account would be $15,000.
D) the balance in the common stock account would be $5,000.

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